The transition of the mining areas affected the gradual elimination of coal would cost Romania 700 million euro

Romania needs 700 million euro for the transition of the mining areas affected by the gradual elimination of coal from the electricity system until 2030 and the investments could be obtained from the budget allocated to the Just Transition Mechanism and which could give our country 757 million euro, says a study coordinated by the think-tank SE3T net, where Energy Policy Group (EPG) and Bankwatch Romania contributed.

According to the quoted source, the delay of a plan for the gradual elimination of coal will lead, in the case of Romania to higher costs by 200 million euro/year, under the form of subsidies given for inefficient thermo power units, something which affects the taxpayers resources.

‘In exchange, the Romanian state can invest these sums in renewable energy, energy efficiency and protection of the vulnerable consumers, investments which could create income and would support the energy transition. Romania can reduce gradually the use of coal without endangering the energy security, having in mind the limited use of coal. The decision makers must plan the gradual elimination of coal on the basis of a well-defined strategy which takes into consideration the economic and social impact’ the study makers say.

In this context, 20,000 workplaces could disappear in Romania, out of which 9,000 are employees in industry, and 19,000 are affected indirectly, the quoted study says.

‘The potential for redevelopment of the areas is huge and very diverse, in such domains as agriculture, tourism, constructions and furniture, textile industry, food industry or electronic parts production. Moreover, the growth of renewable energy units in the area and the projects for electricity efficiency will create new workplaces and can transform the area in a leader in this domain’ Alexandru Mustata, campaign coordinator Bankwatch Romania.

The main conclusion of the study shows the fact that Romania should develop and implement a strategy for the elimination of coal which should include a schedule for the closing down of mines and the withdrawal of thermo power stations as well as the installation of new renewable capacities, as well as other necessary measures for the support of the electricity system.

The study analysed diverse scenarios for the elimination of coal from the electricity system for Romania, Bulgaria and Greece with 2,4, 6 and 8 years respectively earlier than in the reference scenario (REF), earlier than the deadlines taken into consideration at present by the authorities. In the study there were considered the evolution of ETS certificates price, the impact on the price of electricity and the planned investments in power-generating units and there was an analysis of the profitability of coal companies, the price impact on the end-user and the capacity level of the renewable energy sources.

Energy Policy Group (EPG) is a think tank independent, non-profit, set up in 2014 with headquarters in Bucharest. EPG activates in the domain of energy and climate policies and intends to offer the public information and analyses based on evidence regarding public policies, the energy markets and strategic planning. EPG was part of several international research projects regarding the markets and the energy strategy in Romania and South-East Europe.